January 11, 2022
The scheme has a budgetary outlay of INR 25,938 crore
Both existing companies and new investors for automobile or auto component manufacturing were eligible
The scheme will build a robust supply chain, bring in advanced technology, and improve green automotive manufacturing
Incentives for AAT products for vehicles and components manufactured in India from 1 April 2022 will be offered for five years
About 115 companies from the automobile and auto component industry have applied for benefits under the production-linked incentive (PLI) scheme that was notified on September 2021, as the government seeks to improve India’s manufacturing capabilities for advanced automotive technology (AAT) products. The scheme has a budgetary outlay of INR 25,938 crore and it aims to attract investments in the automotive manufacturing value chain. The application window for automobile component manufacturers closed on 9th January 2022 and both existing companies and new investors for automobile or auto component manufacturing were eligible.
The auto PLI scheme is divided into two components – the Champion OEM Incentive Scheme, which is a sales value linked scheme and applies for battery electric vehicles and Hydrogen fuel cell vehicles of all segments; on the other hand, the Component Champion Incentive Scheme, is applicable on AAT components, completely knocked down (CKD)/semi-knocked down (SKD) kits, and vehicle aggregates of 2-Wheelers, 3-Wheelers, passenger vehicles, commercial vehicles and tractors. It is expected that the scheme will address the competitive gaps due to rapid technological shifts and will ensure India becomes an integral part of the global supply chain for AAT products.
Incentives for AAT products for vehicles and components manufactured in India from 1 April 2022 will be offered for five years. The scheme will also overcome cost disabilities, create economies of scale, and generate employment. It is anticipated that manufacturers will invest in indigenous supply chains and ensure the deep localization of AAT products.